I
am particularly pleased to be with you today. I think this meeting is
both timely and important in bringing together agricultural experts
from different backgrounds and nationalities to discuss agriculture
from the perspective of global markets and global needs. In our
interdependent world, we can no longer think of our domestic interests
and policies without reference to the wider global context. Likewise,
it is only with the maximum of international cooperation that we can
find solutions to difficulties which we know transcend political and
cultural frontiers. With the health of the global economy already
clouded by uncertainty, we need urgent and constructive international
action to get our economies back on the path of stable growth and
ensure the benefits of this growth are spread as widely and as justly
as possible.

This
is why it is critical that the Doha Development Agenda — the round
of multilateral trade negotiations launched last year in Qatar —
should be successfully concluded on time. The Doha Development Agenda
is one key element of multilateral cooperation that will stimulate
economic growth, bring greater stability into international economic
relations and help developing countries grow their way out of poverty.
And bringing this Agenda to a successful end will take courage and
leadership. If history has taught us anything it is that in periods of
economic difficulty the temptation to turn inwards and seek to address
our difficulties purely in a national context is greatest. But history
has taught us equally, that such a course of action can be fatal. It
is precisely at times like these that it is important to remind
ourselves of the importance of securing and advancing open markets.

I
should like to talk to you today about three key issues; Firstly, I
want to emphasise that negotiations on agriculture must be seen in the
broader context of the whole trade round. Secondly, I shall briefly
report on the state-of-play of the negotiations. And finally, I should
like to share with you some specific comments on the agriculture
negotiations.

Agriculture
and the broader Trade Round

One
could be forgiven for thinking the Doha Development Agenda is an
agriculture negotiation, by the high profile press coverage this
sector has received. It is of course true that agriculture is a key
element in the negotiations. Agriculture is politically sensitive in
many countries and there are also high expectations for serious reform
from the vast majority of our Members, so finding accommodation will
be challenging. But beyond agriculture there is a very extensive Work
Programme, often overlooked. In fact, the Doha Development Agenda is
the most ambitious and wide-ranging trade negotiation ever undertaken.
This includes market access in non-agricultural goods, services, the
environment and possible new framework agreements on investment,
competition, government procurement and trade facilitation. Members
will also be looking at the links between trade, debt and finance;
trade and the transfer of technology; the specific circumstances of
small economies. And the list goes on.

We
should think of this Work Programme, not just in sector specific
terms, but also in terms of the potential cross-sectoral gains that
can be reaped. Those of you from industry will have a far better idea
than I of the inputs needed in producing feed and foodstuffs and in
getting agricultural produce to markets — but I am sure that, for
example, access to reasonably-priced machinery, efficient
transportation and distribution networks and speedy customs procedures
are all important elements in this process. Many of these issues are
under negotiation in the DDA. The negotiations on market access cover
all non-agricultural products, including pesticides and fertilizers,
agricultural tools and machinery, and the many other goods required in
production and marketing of feed and foodstuffs. The services
negotiations cover virtually all service sectors – from financial
and telecommunication services to distribution and transportation
services that I mentioned earlier. The trade facilitation mandate
addresses all of the issues relevant to the movement of goods in
international trade, and a successful negotiation would go far to
reduce the costs and delays at borders involved in doing international
business. These are just some examples.

State
of Play of negotiations

The
Doha Development Agenda has been under negotiation now for one year
and my assessment, I would say, is rather mixed. The good news is we
have made progress on all fronts and we have not seen any signs of
gridlock. I am concerned, however, that there is a certain unevenness
in progress between different areas of the Work Programme and in
general we are not moving forward as quickly as we need to. We need
more clarity in negotiating positions so we can begin to forge
consensus. And we need all areas of negotiation to move forwards
together so Members can have an early idea of the possible overall
balance of gains and concessions. This is important because the
negotiations will be concluded on the basis of a single undertaking.
This means that nothing is agreed, until everything is agreed
together. So a picture of what the final package might look like must
emerge, with due time for all Members to give it their consideration.
There is no room for cobbling together a deal at the last minute.

We
are now entering a crucial phase of the negotiations with a number of
deadlines looming on the near horizon. The first batch of deadlines
are coming up in December. They are essentially issues of particular
concern to developing countries. They include making more operational
obligations on special and differential treatment — these are the
special rights given to developing countries to account for their
lower levels of development and the differences in benefits they can
reap from the trading system. They also include addressing the issue
of access to essential drugs for countries with insufficient domestic
manufacturing capacity. And they include a package of “implementation
issues”, which relate to developing country concerns about
imbalances in the Uruguay Round agreements. We must make progress in
these areas to give confidence to developing countries that the Doha
Development Agenda is a development agenda not only in name, but also
in substance.

In
early 2003 we also have deadlines in non-agricultural market access,
for modalities in agriculture, and the request / offer process for
services. And then we will be holding our Fifth Ministerial Meeting in
Cancun, Mexico in September — where Ministers will, among other
things, decide upon the future of the “new” issues; investment,
competition, government procurement, and trade facilitation. There is
a real risk that if the early deadlines are not met, then the agenda
for Ministers will be overloaded. If the Cancun Ministerial Conference
is not a success, then I believe the whole round would be put in
jeopardy. I cannot stress enough, how important it is to have a good
result from this meeting. Following Cancun, we will have just over a
year to conclude the negotiations by the mandated deadline of January
2005.

Progress
on Agriculture

Unlike
in the Uruguay Round, we have not started from scratch in agriculture,
but with a mandate to continue the reform process that was only begun
with the Agreement on Agriculture. That has facilitated some aspects
of the negotiations, but some other developments have added
complexity.

The
negotiations have seen an unprecedented engagement and involvement of
developing countries. This is as it should be. Agriculture trade is of
critical importance to the economic development of poor countries,
both importers and exporters. Along with textiles, clothing and a few
other sectors, trade liberalization in agriculture is probably the
single most important contribution the multilateral trading system can
make to help developing countries, including the poorest among them,
to trade their way out of poverty. More players at the table may
complicate the game, but it is the only way to ensure that all gain
from the end results.

The
negotiations have also seen the submission of an unprecedented number
of negotiating proposals. They include very concrete ideas concerning
the all important formulae and quantitative targets for further trade
liberalization. However, they have also brought to the table an array
of other issues, reflecting trade as well as non-trade concerns.

The
Doha Ministerial Conference put the negotiations on a new footing. The
Ministerial Declaration clearly identifies the direction of reform and
the level of ambition aimed at in the areas of market access, export
subsidization and domestic support. It confirms that special and
differential treatment for developing countries will be an integral
part of all elements of the negotiation. And it confirms that
non-trade concerns will be taken into account. This mandate has
provided new impetus for the negotiations, and has set a ruthless
timetable.

Thus
far the negotiations could be kept on track. However, we are now in
perhaps the most difficult phase of all. As I mentioned earlier, in
barely more than four months, the modalities for further commitments
in the three areas, including provisions for special and differential
treatment, must be established. And of course, the negotiations do not
end with the establishment of modalities. Subsequently, for example,
draft schedules of commitments must be put together for submission by
Cancun and negotiations to fine-tune rules are likely to continue well
beyond 2003.

At
this stage, as we are trying to make headway in establishing
modalities, we are up against a number of key problems.

First,
there are still wide gaps in the ambitions of governments, from those
seeking rapid and fundamental reform and liberalization of trade, to
those who are advocating a much more gradual approach. While one side
has very clearly put down what it wants, the other side has not yet
come forward with counter-proposals at the required level of
specificity. This is an observation, by the way, that does not just
hold for one or two issues nor is it just addressed to one or two
participants.

Another
point is that there are still differences in views among developing
countries about what would be appropriate provisions for special and
differential treatment. A delicate balancing act will need to be
played out. On the one hand S&D needs to give space and
flexibility to developing countries in their efforts to promote
agriculture and to address adjustment needs in response to a changing
trading environment. On the other hand, any provisions must ensure
that developing countries contribute to the broadening of trading
channels, including channels for the dynamic South-South trade in
agriculture, as a means to generate income, employment and economic
growth.

Finally,
there are also still strongly held views about the extent and the ways
to take into account a range of non-trade concerns that have been
raised in the negotiations.

The
lack of movement towards convergence in all these areas is worrying,
because March 2003 is approaching fast. We will now have to move
rapidly from position- and coalition-building to deal-making on the
modalities for further commitments. I have been urging Members, who
have not done so to further specify their proposals for modalities in
market access, export competition and domestic support, including
their ideas of the quantitative targets for further reform. I have
been encouraging all Members to sit down with their trading partners,
particularly those with opposite views, to show flexibility and
understanding, and to look for negotiating solutions which, taken
together as a package, are acceptable. And I have been urging
Ministers to keep perspective – to look at agriculture in the
context of the broader round and the gains that can be made elsewhere.
I can only agree with the Chairman of the negotiations on agriculture:
it is time to stop maximizing national positions, and to start
crafting compromises and bridging gaps.

There
is a lot at stake in the negotiations on agriculture, and a lot of
benefits that could flow from reform in this sector, particularly, but
of course, not only for developing countries. Dismantling trade
barriers and trade-distorting subsidies will help boost agricultural
production in countries where food can be produced most efficiently
and in a sustainable way, including in many developing countries where
problems of food security are endemic. It will help developing
countries to broaden and deepen their economies, including by
diversifying their exports and production, helping to shield
themselves from damaging fluctuations in world commodity prices. More
competitive markets can stimulate innovation – promoting diffusion,
both nationally and internationally, of cost-effective,
environmentally-friendly agricultural production technologies and
advances in farm management practices. Moreover the growth that trade
brings, can add to resources available for improving agriculture
infrastructure – such as national transport and food distribution
and marketing systems and it can enhance the power of people to buy
food.

I
hope that my brief report may have given you some food for thought. I
also hope this forum will help in seeking creative solutions to
agricultural reform, both for its own sake and also in the wider
context of the Doha Development Agenda. I look forward to listening to
your comments, suggestions and insights.